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Missing some action, adrenaline rush, and thrill in your life? Are the good old, albeit mundane money investment avenues like mutual funds and fixed deposits not making the cut for you? Want to experience a heart-pounding, financial rollercoaster that will constantly keep you and your portfolio on tenterhooks? Well then, welcome to the world of initial public offers (IPOs), especially those brought to you by SMEs, or <keyword id="6375845" type="General" weightage="20" keywordseo="Small-and-Medium-Enterprises" source="Orion">small and medium enterprises</keyword>. Truth be told, <keyword id="3704207" type="General" weightage="100" keywordseo="SME-IPOs" source="Orion">SME IPOs</keyword> have been all over the bourses this year. So far, 2024 has seen 206 SMEs debuting on both BSE and NSE, out of which 146 listed in gains and 46 listed in losses. Odds seem good, right? In contrast, the year has only seen 63 IPOs from the elder brother i.e. mainboard, only 48 of which managed to post any listing gains. And getting an allotment has also been a major uncertainty, given the unusually high demand this year. <h2>So, what's an SME <keyword id="6354763" type="General" weightage="20" keywordseo="IPO" source="Orion">IPO</keyword>, you ask?</h2>Think of a mainboard company as Shah Rukh or Salman Khan—well-established, financially stable, strong legacy of profitability, and fairly well-known. On the other hand, SMEs are your Prateek Gandhi (Harshad Mehta, Scam 1992), Siddhant Chaturvedi (MC Sher, Gully Boy) or Avinash Tiwary (Majnu, Laila Majnu). While they are doing super well, they are yet to make it big like the Khans. They’re currently underdogs, lesser known, but who knows? They can be the next big thing in the future! And SME IPOs are getting a stellar reception. In 2023, 182 such IPOs had raised a substantial Rs 4,967 crore. In 2024, more than 200 companies have already raised over Rs 7,500 crore, and we have four months to go. This, with one quarter of the year still remaining. <div type="image" title="In 2024, India leads IPO activity in the Asia-Pacific region" height="900" width="1200" msid="113875643" hostid="261" caption="&amp;lt;p&amp;gt;In 2024, India leads IPO activity in the Asia-Pacific region&amp;lt;/p&amp;gt;"></div> But what does it take for a company to be classified as a small enterprise? The company has to have an annual turnover/income of up to Rs 50 crore, and for a medium enterprise to be called so, its annual income has to be up to Rs 250 crore. When such companies go public, in a bid to raise funds from investors and expand their operations, they launch an IPO, but not on the main exchange, but separately, on NSE’s Emerge and BSE’s SME platform. As of September 2024, <keyword id="4484133" type="General" weightage="20" keywordseo="NSE-Emerge" source="Orion">NSE Emerge</keyword> has 147 listed participants, while <keyword id="1885131" type="General" weightage="20" keywordseo="BSE-SME" source="Orion">BSE SME</keyword> has 155 market makers. Mounting an SME’s IPO is comparatively less stringent than their mainboard counterparts, as far as regulations are concerned since their DRHPs (draft <keyword id="12225712" type="General" weightage="20" keywordseo="Red-herring-prospectus" source="Orion">red herring prospectus</keyword>) are not filed with SEBI. So, wouldn’t a lenient treatment make them inherently riskier? Why are they so appealing, you ask? <a href="https://www.businessinsider.in/stock-market/news/a-company-with-8-employees-looking-to-raise-12-crore-ended-up-getting-applications-worth-over-4700-crore/articleshow/112824522.cms">Delhi firm with just 8 employees seeks ₹12 crore via IPO, gets ₹4,700 crore worth of investor applications!</a> Well, for one, some of them have delivered exceptional returns—we’re talking 100%, 200%. Consider this—Owais Metal and Mineral Processing, which launched its IPO in February this year, delivered a whopping listing gain of 201%. Another SME, Maxposure, whose IPO was out in January 2024, had earned its investors listing gains worth 317.40%! Apparently, higher risks also mean higher returns, and also super high investment. Most SME IPOs need a minimum investment of Rs 1,00,000 or more, as opposed to mainboard IPOs, where you can buy one lot of shares for anywhere between Rs 14,000-15,000. Even the minimum trading lot size for SME shares is about 10,000. In short, you’d have to potentially empty your pockets to invest in an SME IPO. And still, there’s no guarantee that the listing will fill your wallets. For all you know, your pockets before and after the IPO is listed might stay the same - EMPTY! There's also the question of whether or not these SMEs are able to maintain their listing day mojo, or do they just fizzle out thereafter? Data from Prime Database highlights more instances of the latter. As of August 2024, about 166 SME IPOs had made it to the exchanges. Around 72 of them, or close to 50%, could not sustain their momentum going ahead, and were trading below their listing day prices. Consider this. The post listing gains of Medicamen Organics, whose IPO came out in June 2024, earned its investors massive listing gains of over 300%, by listing at Rs 137.85, significantly higher than its price issue price, which was set between Rs 32-34. But as of October 1, 2024, the stock was trading at Rs 64.2. Talk about falls. Additionally, risks of pump-and-dump, and illiquidity, among others makes SME IPOs dangerous See, you're largely venturing into unknown, pitch-dark territories, without much light to guide you. For starters, SME IPOs face less scrutiny from market watchdog SEBI. This also means they are able to list quickly, just 3-4 months. On the other hand, mainboard IPOs can take upto a year before they are cleared for listing. Also, there is far less information and disclosures available about their financials, fundamentals and performance to investors for making an informed decision, as compared to mainboard stocks. Then there’s the issue of illiquidity. Once purchased, you might find it hard to sell off your SME stocks, since they are not traded as frequently in the market, which means lower liquidity. Trivesh D, COO, Tradejini explains that liquidity is a major concern for such stocks. “These stocks typically have a smaller free float, and are traded in lots, which can lead to volatility and sharp price swings. This means it can be challenging for investors to buy or sell shares without significantly impacting prices. Additionally, speculative trading practices, like 'pump-and-dump' schemes, can inflate stock prices, leaving retail investors vulnerable to sudden drops”. Recently, SME IPOs have gained notoriety for price manipulation via showing fictitious sales and revenue in their books of accounts, selling of promoter holdings at inflated prices, and being the facade for many infamous <keyword id="10663340" type="General" weightage="20" keywordseo="Pump-and-Dump" source="Orion">pump and dump</keyword> schemes. This is where select people create frenzy, or mass euphoria over a particular stock or company, causing its prices to soar, and then dumping them, or selling their shares at this massive price to make a killing! Infact, it's not just the promoters, but also the investment banks floating these IPOs. At present, SEBI is investigating around 6 investment banks which have allegedly charged SMEs a staggering 15% of funds raised via IPOs as fee, as opposed to the standard 1-3%. In March 2024, SEBI chairperson Madhabi Puri Buch had also highlighted witnessing signs of manipulation in the SME space. “We do see signs of manipulation in the SME segment. We are able to see certain patterns.” Buch had observed back then. Adds Kresha Gupta, Founder &amp; Director, StepTrade Share Services, “Investing in SME IPO comes with significant risks, despite their impressive returns in recent years. Limited participation from institutional investors and public in some SME IPOs also mean that those companies may lack the support and stability that comes with larger-scale investments” “Additionally, many SMEs may not have strong fundamentals to justify their valuations. High P/E ratios can be misleading, and while some IPOs have delivered impressive returns, they often come with significant volatility, continues D of Tradejini. <h2>So, should I stay away? </h2>Yes, and No. Yes, if you don't want to do your homework of researching the company thoroughly beforehand. Anand K. Rathi, Co-Founder of MIRA Money suggests asking a couple of questions before investing your hard earned money: <ul><li>What is the company's financial performance over the past 3-4 years?</li><li>What is the company's governance structure?</li><li>Is the financial success driven by the IPO, or is it a result of consistent performance?</li><li>Does the company have what it takes to scale its operations to the next level?</li><li>Are the company’s promoters trustworthy, capable and experienced?</li><li>What is the level of participation by large, institutional investors?</li></ul> But staying away completely? Not necessary. Gupta adds that retail investors, in particular, should avoid viewing SME IPOs as quick money-makers based on their short-term performance, as this can certainly lead to poor investment decisions. “To mitigate risks, investors should always focus on long-term fundamentals rather than just short-term price movements. Key indicators include the participation of institutional investors like DIIs and FIIs. This often signals confidence in the stock”, she continues. A red flag you should look out for is if a company is only offering OFS, or Offer for Sale. This can indicate early investors looking to exit, potentially signaling weaker future growth. That's why it is better to look for companies which are raising capital for expansion purposes. This is a sign of healthy business growth prospects and improving fundamentals. In conclusion, backing the underdog, or SMEs, is not a bad proposition, but not without its risks. Investing in SME IPOs is like riding a unicorn—but you don't know whether you're riding it to rags or riches! So, take your pick.

Why investing in SME IPOs should not be on top of your adventure to-do list!

New Delhi: <keyword id="22803368" type="General" weightage="100" keywordseo="Smartworks-Coworking-Spaces" source="keywords">Smartworks Coworking Spaces</keyword> Ltd has filed preliminary papers with capital markets regulator <keyword id="19901201" type="General" weightage="20" keywordseo="Sebi" source="keywords" meta.keywordsubtype="org" meta.entityname="Sebi" meta.hostid="345" meta.entityid="Sebi">Sebi</keyword> to raise funds through an <keyword id="19913114" type="General" weightage="20" keywordseo="initial-public-offering" source="keywords">initial public offering</keyword> (IPO). The proposed initial share sale is a combination of a <keyword id="20953853" type="General" weightage="20" keywordseo="fresh-issue" source="keywords">fresh issue</keyword> of equity shares worth Rs 550 crore and an Offer For Sale (OFS) of 67.59 lakh shares by promoters, according to the <keyword id="20076796" type="General" weightage="20" keywordseo="Draft-Red-Herring-Prospectus" source="keywords">Draft Red Herring Prospectus</keyword> (DRHP). The city-based company may consider raising Rs 110 crore through a <keyword id="22244028" type="General" weightage="20" keywordseo="pre-IPO-placement" source="keywords">pre-IPO placement</keyword>. If such placement is undertaken, the amount raised will be deducted from the total fresh issue size. Proceeds from the fresh issue to the tune of Rs 282.30 crore will be used for capital expenditure related to the fit-outs in new centres and security deposits for these new centres, Rs 140 crore will be allocated for payment of loans and the remaining funds will be utilized for general corporate purposes. Smartworks Coworking Spaces Ltd is a leading platform for office experiences and managed campuses. It specialises in leasing large, bare-shell properties in prime locations and transforming them into fully serviced, tech-enabled campuses with modern amenities. These campuses include cafeterias, sports zones, gyms, crA"ches, medical centres, and more, offering a modern and attractive work environment. The company cater to businesses of all sizes, with a focus on mid-to-large companies that need over 300 seats. The company is concentrated in cities including Bengaluru, Mumbai Metropolitan Region, Hyderabad, Gurugram and Chennai. India's commercial office space was about 841.2 million square feet as of March 31, 2024, and is expected to grow at an annual rate of 6.71 per cent to 1,079.3 million square feet by the end of 2027, as per the draft papers. Flexible workspaces have become a key part of modern work culture, supporting different working styles and adding flexibility to the office market. JM Financial Ltd, BOB Capital Markets Ltd, IIFL Securities Ltd and Kotak Mahindra Capital Company Ltd are responsible for managing the company's IPO process.

Smartworks Coworking Spaces files IPO papers with Sebi; eyes Rs 550 crore via fresh issue

Capital markets controller <keyword id="35210" type="ORGANIZATION" weightage="20" keywordseo="sebi">SEBI</keyword> has given <keyword id="6426359" type="COMPANY" weightage="100" keywordseo="PNB-Housing-Finance">PNB Housing Finance</keyword> a thumbs up to raise Rs 2,500 crore through an Initial Public Offering (IPO). 
 The IPO papers have been documented by the <keyword id="47268" type="ORGANIZATION" weightage="20" keywordseo="PNB">PNB</keyword> lodging Finance with SEBI in July. The markets regulater, on October 6, issued its last perceptions on the draft offer reports. 
 
The returns from the share sale would be principally utilized towards expanding its capital base by PNB Housing Finance. 
 As indicated by the <keyword id="53370" type="ORGANIZATION" weightage="20" keywordseo="Draft-Red-Herring-Prospectus">Draft Red Herring Prospectus</keyword> (<keyword id="131606" type="ORGANIZATION" weightage="20" keywordseo="DRHP">DRHP</keyword>), the company plans to raise up to Rs 2,500 crore through the underlying share sale and a portion would be reserved for the employees. 
 
"We believe that the listing of our equity shares will enhance our visibility and brand name among existing and potential customers," it added. 
 
The company plans to grow business and loan portfolio by consolidating position in key geographies as well as by expanding into specific target markets such as the affordable housing segment. 
(image: Indiatimes)

PNB Housing Finance to raise Rs 2,500 cr through IPO

<div class="KonaFilter image-container display-table"><div><div class="image on-image"></div></div></div><ul><li>Rudy Giuliani on Monday claimed collusion is not a crime in connection with the investigation into Russian election interference in 2016.</li><li>But experts say his comments were misleading.&#xa0;</li><li>Conservative media figures have made <a href="https://www.businessinsider.com/collusion-russia-trump-crime-2017-6">similar cases regarding collusion</a> in the past as well.</li><li>Collusion is not a legal term, but the term could be used to describe certain interactions between a presidential campaign and a foreign government that are illegal under existing statutes.&#xa0;</li></ul>Rudy Giuliani, the attorney for President Donald Trump, claimed Monday that collusion is "not a crime," in relation to investigations into Russian election interference and whether any Trump associates colluded with Russian officials to try to tip the scales in Trump's favor.Experts say his comments are misleading and miss the larger point of the special counsel Robert Mueller's investigation."I have been sitting here looking in the federal code trying to find collusion as a crime," Giuliani said during a "Fox &amp; Friends" interview. "Collusion is not a crime.""I don't even know if that's a crime - colluding with Russians. Hacking is the crime. The president didn't hack. He didn't pay for the hacking," he said during a subsequent interview with CNN.Trump has long maintained there was "no collusion" between the Kremlin and his campaign. But Giuliani went further, seemingly contending that it wouldn't be illegal in any case, echoing&#xa0;<a href="https://www.businessinsider.com/collusion-russia-trump-crime-2017-6">similar cases on collusion</a>&#xa0;from conservative media figures in the past.<h2>'It's a red herring by Giuliani'</h2>"Collusion" is not explicitly cited in US legal code. But certain interactions between a presidential campaign and a foreign government could be illegal under existing statutes, experts say."It's a red herring by Giuliani," Bradley P. Moss, a Washington, DC-based lawyer specializing in national security, told Business Insider.He noted that the term "collusion" doesn't appear in the memo from Deputy Attorney General Rod Rosenstein appointing Mueller as special counsel."Mueller isn't investigating 'collusion.' He is investigating possible coordination between the campaign and the Russians, particularly any actual crimes committed in the context of that coordination," Moss said.&#xa0;Moss said that conspiracy to defraud the US is a crime, under <a href="https://www.law.cornell.edu/uscode/text/18/371">18 USC 371.</a>"Underlying offenses would likely be tied up in criminal provisions regarding campaign finance laws or computer hacking. For the conspiracy charge to succeed, it is not required that every participant in the conspiracy play the same substantive role," he said.Alex Whiting, a law professor at Harvard and former federal prosecutor, told Business Insider that "there is no crime of 'collusion' but as Giuliani well knows there are plenty of potential crimes within the act of collusion.""Russian companies and individuals have been charged with conspiracy to defraud the United States as a result of their alleged acts of election interference and hacking and distribution of emails," Whiting added. "If American citizens knowingly assisted these efforts, which could be described as 'collusion,' they could also be charged with conspiracy to defraud the United States."Whiting also said there are potential campaign violations that could be charged, "in particular prohibitions on foreign contributions to campaigns, if it were discovered that Americans 'colluded' with Russians to interfere with the campaign."Asha Rangappa,&#xa0;senior lecturer at the&#xa0;Jackson Institute for Global Affairs&#xa0;at Yale University and&#xa0;former FBI special agent, expressed similar sentiments on Monday in an appearance on CNN and via Twitter. "Conspiracy and aiding and abetting are forms of collusion that are indeed a crime. And even if there are some acts of collusion that don't meet a criminal definition, 'colluding about the Russians' IS STILL A PROBLEM," she said.<div></div><div>&#xa0;<div></div></div><div></div> <div class="margin-top"> <h3>NOW WATCH: <a href="http://www.businessinsider.com/diehard-mac-user-switches-pc-windows-2018-7">A diehard Mac user switches to PC</a></h3> <div> </div> </div></hr>

Giuliani says collusion is 'not a crime.' Legal experts say that's a 'red herring'

<div class="KonaFilter image-container display-table float_right"><div><div class="image on-image">Mark Blinch/ReutersA woman walks past graffiti which reads, "KA-CHING" near condominium buildings behind a lot of vacant land that is boarded up in Toronto.</div></div></div>Canadian home prices just saw the <a href="http://www.businessinsider.com/canada-teranet-national-bank-housing-prices-january-2017-2017-2">largest 12-month increase</a> in a decade amid the ongoing housing boom in Toronto.The annual rate of national house price inflation climbed to 13.0% year-over-year in January, up from the prior month's reading of 12.3%, according to the latest Teranet-National Bank Composite House Price Index released earlier this week.Toronto, specifically, saw its annual rate of house price inflation climb to 20.9% YoY, up from 19.7%. Moreover, Hamilton, an area near Toronto, saw home prices spike by 17.6% YoY as buyers were "<a href="http://www.reuters.com/article/canada-economy-housing-teranet-idUSL1N1FZ0MU">shut out of the expensive Toronto market</a>."Some have argued that the drive-up in prices is due to first-time buyers trying to jump into a decreasing supply of homes. However, in a recent note to clients, David Madani, Senior Canada Economist at Capital Economics, argued that that line of thinking is a "red herring." Rather, he believes, the price hike is being driven by move-up buyers leveraging the equity in their existing homes.<div class="KonaFilter image-container display-table float_right"><div><div class="image on-image">Capital EconomicsThe red arrow shows how Toronto home prices continue to surge.</div></div></div>"... first-time home buyers aren't the ones driving the biggest gains in Toronto house prices, based on the simple logic that they simply don't have high enough incomes to afford them, by any mortgage lenders standard," he wrote in a note to clients. "The truth is that it's mainly being driven by move-up buyers leveraging the equity in their existing homes."His team "guesses" that first-time buyers only made up about 20% of Toronto's home sales."Since these move-up home buyers obviously already live in a home and are largely responsible for the big increases in house prices, it stands to reason that there isn't a major shortage of housing causing housing prices to escalate," he continued. "Investors are the other reason for rising house prices. There are always shortages of housing for people wanting to buy their third, fourth or tenth property!"Notably, <a href="http://www.businessinsider.com/toronto-has-more-than-99000-unoccupied-homes-2017-2">recently released data</a> from Statistics Canada show that Toronto has over 99,000 homes that are not regularly occupied, totaling about 4.5% of the city's supply. Those watching the Toronto housing market have articulated similar arguments to that of Madani in the past. Mike Crawley from <a href="http://www.cbc.ca/news/canada/toronto/foreign-buyers-tax-toronto-real-estate-investors-1.3824467">CBC News previously reported</a> in November 2016 that analysts have noted that the "home-grown source of the surge in demand [is due to] investors who are buying houses not as a place to live, but as a place to grow their money."Investor interest is bringing "thousands of new buyers to the market who otherwise would not have been there," John Pasalis, president of the real estate brokerage Realosophy, <a href="http://www.cbc.ca/news/canada/toronto/foreign-buyers-tax-toronto-real-estate-investors-1.3824467">told</a><a href="http://www.cbc.ca/news/canada/toronto/foreign-buyers-tax-toronto-real-estate-investors-1.3824467"> CBC News at the time</a>. "It basically is adding a significant number of offers on every property and is driving up house prices as a result."As we have warned before, investment mania is the root cause of the escalation in house price gains, and this appears to be the case among homeowners and investors in Toronto, Madani added in the conclusion of his note. This activity often creates the illusion of shortages when bubbles are inflating, even when there is evidence to the contrary of a booming housing construction industry."Let's drop the pretense," Douglas Porter, the chief economist at BMO Capital Markets, wrote in a commentary in mid-February, <a href="http://www.cbc.ca/news/business/toronto-housing-bubble-1.3985497">according to CBC News</a>. "The Toronto market - and the many cities surrounding it - are in a housing bubble." <div class="margin-top"> <h3>NOW WATCH: <a href="http://www.businessinsider.com/hair-surgeon-doctor-explains-donald-trumps-hair-2017-2">Trump's doctor and a hair surgeon explain what's going on with his hair</a></h3> <div> <div> <div class="ooyala-video-player" data-video-autoplay="false" data-video-id="trOXdjOTE6IFcGouxQyU8cNSjHy2h8cz" data-player-variable="ooyalapopvideo" id="ooyalaplayer_popvideo" style="width:1280px;height:720px"></div> </div> </div> </div>

Blaming Toronto's housing 'mania' on first-time homebuyers is a 'red herring'

Jeremy Grantham is not a believer in the shale fracking boom.
Back in November, we highlighted <a href="http://www.businessinsider.com/jeremy-grantham-on-oil-economic-growth-2014-11">Grantham's full quarterly letter to GMO clients</a>, in which he said, among other things, that the US shale boom had been "a very large red herring."
So while some say the fracking boom has helped keep <a href="http://www.businessinsider.com/crude-oil-breaks-67-2014-11">oil prices low</a> and aided the US on its <a href="http://www.businessinsider.com/us-energy-independence-one-chart-2014-10">path to energy independence</a>, Grantham thinks it might have set us on a path to nowhere.
"Its development has been remarkable," Grantham writes.
"It will surely be seen in the future as a real testimonial to the sheer energy of American engineering at its best, employing rapid trials and errors - with all of the risk-taking that approach involves - that the rest of the world finds so hard to emulate. Similarly, it will always stand out as remarkable proof that, so late in the realization of the risks of climate change and environmental damage, the US could expressly deregulate such a rapidly growing and potentially dangerous activity."
The <a href="http://www.businessinsider.com/jeremy-grantham-on-oil-economic-growth-2014-11">overall thrust</a> of Grantham's letter is that the world will soon be devoid of the resources it is going to need to sustain our current economic model, which over the past 150 or so years has been predicated on cheap energy, namely oil.&#xa0;
A concern Grantham has with fracking is that the boom hasn't been accompanied by any real concern as to the environmental damage it may be inflicting.&#xa0;But Grantham is also hugely skeptical on the potency of the shale boom because it doesn't address the problem of our need for cheap oil.&#xa0;
Grantham writes: Fracking&#xa0;"has not prevented the underlying costs of traditional oil from continuing to rise rapidly&#xa0;or the cash flow available to oil-producing countries like Saudi Arabia, Iran, and especially Venezuela from getting squeezed from both ends (rising costs and falling prices)."
And as we saw last week, <a href="http://www.businessinsider.com/opec-votes-not-to-cut-production-oil-prices-plummet-2014-11">OPEC announced</a> that it would not impose production cuts despite the sharp decline in oil prices seen over the past few months, and it seems unlikely that Grantham would be surprised by this.&#xa0;
Because if your national economy is chiefly predicated on exporting oil, you have made your bed and <a href="http://www.businessinsider.com/oil-production-breakeven-prices-2014-11">therefore must lie in it</a> as oil prices drop.&#xa0;
<a title_source="Deutsche Bank" title_caption="The US shale boom, in one chart." class="zoomin" href="https://static-ssl.businessinsider.com/image/546e66ea6bb3f77d6db7d0b4-960/markets%20cotd%20november%2020.jpeg"><a href="http://www.businessinsider.com/us-crude-oil-production-the-chart-of-the-year-2014-11"></a></a>Deutsche BankThe US shale boom, in one chart.But the US boom, which as Grantham notes has accounted for almost all of the <a href="https://www.google.com/url?sa=t&amp;rct=j&amp;q=&amp;esrc=s&amp;source=web&amp;cd=1&amp;cad=rja&amp;uact=8&amp;ved=0CCAQFjAA&amp;url=http%3A%2F%2Fwww.businessinsider.com%2Fus-crude-oil-production-the-chart-of-the-year-2014-11&amp;ei=AkZ7VNn3Ke6asQTp54KYCg&amp;usg=AFQjCNHkvJNcjv3w8yaKVv5r-0Qc42rdYQ&amp;sig2=KtsFWT5Il5D3s8fHKbIBKw&amp;bvm=bv.80642063,d.cWc">increase in global oil production </a>over the past several years, has been undertaken by companies, not countries.
And so with an eye toward profit, Grantham writes, these companies "have drilled, as always, the best parts of the best fields first, and because the first two years of flow are basically all we get in fracking, we should have expected <a href="http://www.businessinsider.com/citi-breakeven-oil-production-prices-2014-11">considerably better financial</a> results by now. The aggregate financial results allow for the possibility that fracking costs have been underestimated by corporations and understated in the press."&#xa0;
And with a decline in oil prices set off by too much supply, it will be these companies that are forced to pare production, which will reduce supply, which will create - once again - expensive oil.&#xa0;
"The current fall&#xa0;in price does nothing to offset the squeeze on the total&#xa0;economy from rising costs," Grantham writes. "It merely transfers massive&#xa0;amounts of income from one subgroup (oil producers)&#xa0;to another (oil consumers), in a largely zero-sum game.
"Oil consumers tend to spend more and save less than&#xa0;oil companies so short-term impacts are favorable. But we should not be carried away with enthusiasm because the declining investment from the oil industry will lower future growth. When, as now, oil costs are still rising even as prices fall there is of course a particularly savage effect on the profits of oil companies, squeezed from both ends.
"They must and will rapidly adapt by&#xa0;reducing expenditures and therefore oil production with&#xa0;the fairly obvious result that prices will rise again.&#xa0;The only longer-term price relief and net benefit to&#xa0;the economy will come when either we reverse recent&#xa0;history and start to find more oil more cheaply, which&#xa0;will be like waiting for pigs to fly, or when cheaper&#xa0;sources of energy displace oil."
And so for Jeremy Grantham, nothing fundamental has changed about our relationship with oil:&#xa0;pigs still don't fly.&#xa0;

GRANTHAM: 'US Fracking Is A Very Large Red Herring'

<div class="KonaFilter image-container display-table float_right"><div><div class="image on-image"></div></div></div>Jeremy Grantham is not a believer in the shale fracking boom.
Earlier this month, we highlighted <a href="http://www.businessinsider.com/jeremy-grantham-on-oil-economic-growth-2014-11">Grantham's full quarterly letter to GMO clients</a>, in which he said, among other things, that the US shale boom has been "a very large red herring."
So while some say the fracking boom has has helped keep <a href="http://www.businessinsider.com/crude-oil-breaks-67-2014-11">oil prices low</a> and aided the US on its <a href="http://www.businessinsider.com/us-energy-independence-one-chart-2014-10">path to energy independence</a>, Grantham thinks it might have set us on a path to nowhere.
"Its development has been remarkable," Grantham writes.
"It will surely be seen in the future as a real testimonial to the sheer energy of American engineering at its best, employing rapid trials and errors - with all of the risk-taking that approach involves - that the rest of the world finds so hard to emulate. Similarly, it will always stand out as remarkable proof that, so late in the realization of the risks of climate change and environmental damage, the U.S. could expressly deregulate such a rapidly growing and potentially dangerous activity."
The <a href="http://www.businessinsider.com/jeremy-grantham-on-oil-economic-growth-2014-11">overall thrust</a> of Grantham's letter is that the world will soon be devoid of the resources it is going to need to sustain our current economic model, which over the last 150 or so years has been predicated on cheap energy, namely oil. 
A concern Grantham has with fracking is that the boom hasn't been accompanied by any real concern as to the environmental damage it may be inflicting. But Grantham is also hugely skeptical on the potency of the shale boom because it doesn't address the problem of our need for cheap oil. 
Grantham writes that, "[Fracking] has not prevented the underlying costs of traditional oil from continuing to rise rapidly or the cash flow available to oil-producing countries like Saudi Arabia, Iran, and especially Venezuela from getting squeezed from both ends (rising costs and falling prices)."
And as we saw last week, <a href="http://www.businessinsider.com/opec-votes-not-to-cut-production-oil-prices-plummet-2014-11">OPEC announced</a> that it would not impose production cuts despite the sharp decline in oil prices seen over the last few months, and it seems unlikely that Grantham would be surprised by this. 
Because if your national economy is chiefly predicated on exporting oil, you have made your bed and <a href="http://www.businessinsider.com/oil-production-breakeven-prices-2014-11">therefore must lie in it</a> as oil prices drop. 
<div class="KonaFilter image-container display-table float_right click-to-enlarge"><div><div class="image"><a title_source="Deutsche Bank" title_caption="The US shale boom, in one chart." class="zoomin" href="https://static-ssl.businessinsider.com/image/546e66ea6bb3f77d6db7d0b4-960/markets cotd november 20.jpeg"><a href="http://www.businessinsider.com/us-crude-oil-production-the-chart-of-the-year-2014-11"></a></a>Deutsche BankThe US shale boom, in one chart.</div></div></div>But the US boom, which as Grantham notes has accounted for almost all of the <a href="https://www.google.com/url?sa=t&amp;rct=j&amp;q=&amp;esrc=s&amp;source=web&amp;cd=1&amp;cad=rja&amp;uact=8&amp;ved=0CCAQFjAA&amp;url=http%3A%2F%2Fwww.businessinsider.com%2Fus-crude-oil-production-the-chart-of-the-year-2014-11&amp;ei=AkZ7VNn3Ke6asQTp54KYCg&amp;usg=AFQjCNHkvJNcjv3w8yaKVv5r-0Qc42rdYQ&amp;sig2=KtsFWT5Il5D3s8fHKbIBKw&amp;bvm=bv.80642063,d.cWc">increase in global oil production </a>over the last several years, has been undertaken by companies, not countries.
And so with an eye towards profit, Grantham writes that these companies, "have drilled, as always, the best parts of the best fields first, and because the first two years of flow are basically all we get in fracking, we should have expected <a href="http://www.businessinsider.com/citi-breakeven-oil-production-prices-2014-11">considerably better financial</a> results by now. The aggregate financial results allow for the possibility that fracking costs have been underestimated by corporations and understated in the press." 
And with a decline in oil prices set off by too much supply, it will be these companies that are forced to pare production, which will reduce supply, which will create - once again - expensive oil. 
"The current fall in price does nothing to offset the squeeze on the total economy from rising costs," Grantham writes. "It merely transfers massive amounts of income from one subgroup (oil producers) to another (oil consumers), in a largely zero-sum game.
<div class="KonaFilter image-container display-table float_left click-to-enlarge"><div><div class="image"><a title_source="FRED" title_caption="Gas prices have plunged, helping consumers in the short-term, but potentially hampering producers longer-term." class="zoomin" href="https://static-ssl.businessinsider.com/image/547b498ceab8ea51150a0dcc-960/fredgraph (1)-17.png"></a>FREDGas prices have plunged, helping consumers in the short-term, but potentially hampering producers longer-term.</div></div></div>"Oil consumers tend to spend more and save less than oil companies so short-term impacts are favorable. But we should not be carried away with enthusiasm because the declining investment from the oil industry will lower future growth. When, as now, oil costs are still rising even as prices fall there is of course a particularly savage effect on the profits of oil companies, squeezed from both ends.
"They must and will rapidly adapt by reducing expenditures and therefore oil production with the fairly obvious result that prices will rise again. The only longer-term price relief and net benefit to the economy will come when either we reverse recent history and start to find more oil more cheaply, which will be like waiting for pigs to fly, or when cheaper sources of energy displace oil."
And so for Jeremy Grantham, nothing fundamental has changed about our relationship with oil: pigs still don't fly.

FA Insights is a daily newsletter from Business Insider that delivers the top news and commentary for financial advisors.
<a href="http://blogs.ft.com/the-a-list/2013/01/10/european-separatism-is-a-red-herring/#axzz2HbQRHhPi">European Separatism Is One Of 2013's Biggest Red Herrings</a> (Financial Times) 
Despite separatist demands in Spain, Scotland, and Belgium, Ian Bremmer president of Eurasia Group says European separatism is one of the biggest red herrings of 2013. 
Catalonia will move towards a referendum but is unlikely to vote till 2014, and by then a deal with Madrid could calm demands for autonomy. Similarly a call for Scottish autonomy is a 2014 issue. Many Scots are concerned with what this would mean for defense and oil revenues with the UK. 
<a href="http://www.businessweek.com/news/2013-01-09/bats-says-system-errors-caused-pricing-problems-over-4-years#p2">BATS Trading System Errors Add To Concerns About Electronic Trading</a> (Bloomberg)
BATS, the third largest stock exchange operator in the U.S. said that machines that match orders and one options venue had let some trades go through at prices that were lower than the best bid the was available at the time. They also let some violate short sales rules. Customers lost $420,360 because of the violations. 
This has added to concerns about electronic trading. <a href="http://online.wsj.com/article/SB10001424127887324581504578233462967563782.html">BATS CEO Joe Ratterman</a> told The Wall Street Journal that such problems are a "part of the business of being an exchange in an electronic environment".
<a href="http://www.businessinsider.com/chart-gold-post-election-years-2013-1">CHART: Post-Election Years Are Great For Gold Mining Stocks</a> (US Funds) 
Federal election years have been bad for gold miners as measured by the Philadelphia Stock Exchange Gold and Silver Index (XAU), according to Frank Holmes at U.S. Funds. Post-election years however tend to be great.
<div class="image-container" style="width:551px"><div class="image"></div><a href="http://www.businessinsider.com/us-funds-2013-outlook-2013-1">US Funds</a></div>
<a href="http://online.wsj.com/article/SB10001424127887324081704578233742441525264.html?mod=googlenews_wsj"> The Health Of The Traditional Brokerage Model Is Being Questioned</a> (The Wall Street Journal) 
Traditionally the fourth quarter is the time when brokerages post their strongest results, since it is the time when there is little movement of brokers since it is difficult to transfer registration. And because its the best time for fees and commissions since that is when clients assets are moved to the best tax position. 
In coming weeks, the biggest brokerages will report how they did in terms of client-asset growth and adviser retention. If the performance is unchanged it will raise concerns about the viability of the traditional brokerage model. 
<a href="http://www.businessinsider.com/david-rosenberg-isnt-too-worried-about-the-sell-off-in-treasuries-2013-1">ROSENBERG: Treasuries Are Selling Off, But We've Seen This Happen 8 Times Since 2007</a> (Gluskin Sheff)
"The Treasury market has sold off recently, and the 10-year note yield has already moved up nearly 50 basis points from its nearby multi-decade low (jumping more than 20 bps in less than two weeks).
It was overbought then. It is oversold now... but let's not pretend we haven't seen these hiccups before. We have had no fewer than eight such episodes of 50+ basis points spasms since yields peaked in the summer of 2007. Each one did not last long and presented a gift of a buying opportunity for patient investors who have an ability to see the forest past the trees. Typically, these hiccups last 49 trading days and the yield rises an average of 88 bps, with about three quarters of the prior rally being reversed.
Even though this recent setback of Treasuries has exceeded the historical norm in duration and as such a near-term bounce is likely in the offing, recent history suggests it is not impossible to see a move to a 2-2.3% band during this time. But is this nothing more than a blip in what is still a secular bull market in bonds? Recent history would say yes."

FINANCIAL ADVISOR INSIGHTS: European Separatism Is One Of This Year's Biggest Red Herrings

UTI Asset Management Company (AMC) has received markets regulator Sebi's go ahead to raise a little over Rs 3,000 crore through its initial public offering (IPO). The IPO of the country's largest asset management company in terms of total assets under management (AUM) comprises sale of 3,89,87,081 equity shares by existing shareholders, according to the <keyword id="9447718" type="UNKNOWN" weightage="20" keywordseo="draft-red">draft red</keyword> herring prospectus (DRHP). State Bank of India (SBI), <keyword id="6365973" type="COMPANY" weightage="20" keywordseo="life-insurance-corporation">Life Insurance Corporation</keyword> (LIC) and Bank of Baroda are offering to sell 1,04,59,949 shares each, while Punjab National Bank (PNB) and T Rowe Price International are planning to offload 38,03,617 shares each. The public offer is expected to raise a little over Rs 3,000 crore, market sources said. UTI AMC, which had filed draft papers with Sebi in December 2019, obtained its observations on June 16, latest update with the markets watchdog showed. Sebi's observations are necessary for any company to launch <keyword id="122704" type="PERSON" weightage="20" keywordseo="public-issues">public issues</keyword> including initial share-sale, follow-on public offer and rights issue. SBI, LIC, Punjab National Bank and Bank of Baroda hold 18.5 per cent stake each in UTI AMC. The US-based T Rowe Price holds 26 per cent stake in the company. <keyword id="39409" type="COMPANY" weightage="20" keywordseo="Kotak">Kotak</keyword> Mahindra Capital, Axis Capital, CitiBank, DSP Merrill Lynch, ICICI Securities, JM Financial and SBI Capital Markets are the book running lead managers to the offer. The shares of the company are proposed to be listed on BSE and NSE. As of September 30, 2019, the company had the largest share of monthly average AUM. In December 2019, Sebi had asked SBI, LIC and PNB to dilute their stakes to below 10 per cent in UTI AMC by December next year. Under Sebi's mutual fund regulations, a shareholder or a sponsor owning at least 10 per cent stake in an AMC is not allowed to have 10 per cent or more stake in another mutual fund house operating in the country. SEE ALSO:<a href="https://www.businessinsider.in/stock-market/markets/news/hcl-tech-infoedge-biocon-and-peers-safe-stocks-for-2020/articleshow/76523192.cms" data-type="tilCustomLink"> HCL Tech, InfoEdge, Biocon and their peers may be safe stocks to hide for the rest of 2020</a> <a href="https://www.businessinsider.in/tech/news/googles-sundar-pichai-facebook-and-amazon-heres-how-american-companies-reacted-to-donald-trumps-h1-b-visa-freeze/articleshow/76522530.cms" data-type="tilCustomLink">Google’s Sundar Pichai, Facebook and Amazon — here’s how American companies reacted to Donald Trump’s H1-B visa freeze</a>

The IPO from India's largest asset management company UTI AMC is ready to hit the street

<ul class="summary-list"><li>Bets against the <keyword id="35208" type="ORGANIZATION" weightage="60" keywordseo="dollar">dollar</keyword> have risen to their highest level in close to a decade.</li><li>The shorts against the dollar come despite the greenback rising around 0.6% this year.</li><li>Analysts say Treasury yields have been the key driver and could cause dollar bears more pain.</li></ul>Bets against the dollar have risen to near their highest level in a decade, but uncertainty is creeping in about the greenback's short-term direction of travel.Hedge funds, asset managers and other institutional investors increased their net short position to $34.04 billion in the week ending January 12, according to <a href="https://www.reuters.com/article/cftc-forex/speculators-increase-net-short-dollar-position-in-latest-week-cftc-reuters-data-idUKL1N2JQ2HZ">Reuters data</a>. That was the biggest bet against the dollar since 2011.It comes despite the recent rise in the dollar, which has been driven in part by President-elect Joe Biden's <a href="https://www.businessinsider.com/joe-biden-stimulus-plan-details-checks-congress-direct-payments-unemployment-2021-1">stimulus plans</a> pushing up bond yields - making dollar assets more attractive - and boosting growth expectations. The <a href="https://markets.businessinsider.com/index/us-dollar-index">dollar index</a> has climbed around 0.6% this year, although it was off by 0.31% to 90.49 on Tuesday morning."The USD consolidation has reached reasonable levels without yet breaking anything," John Hardy, head of FX strategy at Saxo Bank, said in a note.Read More: <a href="https://www.businessinsider.com/market-crash-bubble-bursts-social-unrest-albert-edwards-societe-generale-2021-1" target="_blank" rel="noopener noreferrer">Billionaire investor Ray Dalio warned the US could be on the verge of civil war - Now a prominent market bear is saying investors should monitor this under-the-radar bubble, which could trigger unrest</a>Before the recent bout of strength, the dollar slid around 7% in 2020, as the Federal Reserve slashed interest rates and pumped money into the economy, while the US's twin deficits mounted.Investors broadly expect these dynamics to weigh on the dollar in 2021, but are increasingly scrutinizing a number of factors.The most recent is Treasury secretary nominee <keyword id="116249" type="PERSON" weightage="60" keywordseo="Janet-Yellen">Janet Yellen</keyword>'s plan to affirm the US's hands-off approach to exchange rates, as reported by the <a href="https://www.wsj.com/articles/yellen-prepared-to-affirm-commitment-to-market-determined-dollar-value-11610917212">Wall Street Journal</a>.Yellen's commitment marks a turn away from Donald Trump's repeated pushes for a weaker dollar. But it also means the Treasury could be fine with further dollar decline.Also weighing on dollar bears' minds is the possibility that the big bets against the buck could fuel a further rally - at least in the short-term - if investors have to suddenly change course.Adarsh Sinha, currency strategist at Bank of America, said in a note: "At [around] 10% of open interest, average short USD positions are indeed close to levels that have typically preceded USD rallies over the past decade."Yet he said <keyword id="891658" type="PERSON" weightage="60" keywordseo="short-positions">short positions</keyword> were something of a "red herring". He said the real "red flag" is bond yields.The yield on the US-10 year Treasury note has risen from 0.917% to 1.116% this year, supporting the dollar.Read More: <a href="https://www.businessinsider.com/stock-picks-to-buy-best-profit-growth-reopening-goldman-sachs-2021-1" target="_blank" rel="noopener noreferrer">GOLDMAN SACHS: Buy these 25 stocks best-positioned to juice profits in 2021 as stimulus and vaccine progress spur economic growth</a>Hugh Gimber of JPMorgan Asset Management said in a note that "it is unclear as yet how the Fed will react in the recovery". Should Biden's stimulus cause a rapid rebound, the Fed may signal tighter policy, which could "steepen the [bond] yield curve and may stem the dollar's decline".Bank of America's Sinha said currency investors should keep an eye on bond yields, but they must be weighed against "structural factors" such as the US's budget and trade deficits.BofA expects the dollar to decline by around 3% to 5% in 2021, which Sinha said is "relatively conservative".Yet Kit Juckes of Societe Generale stressed the Fed's recent dovishness. He said it has committed to "accompany fiscal largesse with super-easy policy" which "should keep the dollar down even if the economy does well in both absolute and relative terms".

Investor bets against the dollar are at their biggest in almost 10 years, but rising Treasury yields are a red flag for bears, analysts say

<ul class="summary-list"><li>Kevin Costner didn't return for "Yellowstone" season five, part two.</li><li>The actor said that he "didn't quit the show," but left due to scheduling conflicts.</li></ul>Warning: Spoilers ahead for "<a target="_blank" rel="" class="" href="https://www.businessinsider.com/yellowstone-timeline-of-controversy-criticism-conflict-kevin-costner-2023-4">Yellowstone</a>" season five, episode nine.Kevin Costner was just as surprised at John Dutton's "Yellowstone" write-off as you were.The actor spoke about the circumstances of his departure from the show, and his reaction to Dutton's end, on <a target="_blank" class="" href="https://www.youtube.com/watch?v=GpZo445fBHo">"SiriusXM's The Michael Smerconish Program."</a> Costner spoke with Smerconish the day after season five, part two of "Yellowstone" premiered — and revealed that he hadn't even been aware the episode was scheduled to air.<a target="_blank" class="" href="https://www.businessinsider.com/yellowstone-timeline-of-controversy-criticism-conflict-kevin-costner-2023-4">"Yellowstone's" behind-the-scenes drama</a> has drawn just as much attention as its on-screen action. After reports began to circulate in early 2023 that Costner may be departing the show — or at least, that his filming time may be curtailed for season five, part two — Paramount announced in May 2023 that the series' fifth season would be its last (though it's <a target="_blank" class="" href="https://www.businessinsider.com/yellowstone-season-5-return-release-date-cast-plot-2023-11">TBD whether that's actually the case</a>). Costner confirmed in June 2023 court filings amid his divorce from Christine Baumgartner that he was <a target="_blank" class="" href="https://www.businessinsider.com/kevin-costner-no-longer-under-contract-for-yellowstone-court-document-2023-7">no longer under contract</a> for the series.On Monday, Costner told Smerconish his departure from "Yellowstone" was the result of scheduling conflicts. The actor has been working on his <a target="_blank" class="" href="https://www.businessinsider.com/kevin-costner-horizon-an-american-saga-4-films-planned-2024-7">"Horizon" film series</a>, which <a target="_blank" class="" href="https://www.businessinsider.com/horizon-an-american-saga-reviews-critics-pan-kevin-costners-movie-2024-5">debuted in May to lackluster reviews.</a>"I didn't quit the show," he said. "There was no, there was just a, you know, everybody has to live up to what they say they're going to do."<a target="_blank" class="" href="https://www.businessinsider.com/yellowstone-will-kevin-costner-appear-in-season-5b-episodes-2024-8">"Yellowstone" dealt with Costner's departure by killing his character</a>, John Dutton, off-screen in season five, episode nine. While it initially appears that he died by suicide, the show reveals that his death was the result of a hit.Costner told Smerconish he hadn't realized that Dutton's death was airing the night before and that he had yet to watch the episode."I heard it's a suicide, so that doesn't make me want to rush to go see it," Costner said. He said, however, that the death could have been a "red herring."The actor also said that he had proposed several endings for his character over the course of "Yellowstone,'" and told Smerconish that he hadn't been certain he would remain involved up to season five. Dutton's eventual end on the show was not one of those possibilities, but Costner expressed faith in the show's direction."Whatever they're doing, they'll figure it out," he said. "But yeah, I had come up with two possible endings back when it wasn't going to go as long as it did."In case you missed the premiere, here's <a target="_blank" class="" href="https://www.businessinsider.com/guides/streaming/where-to-watch-yellowstone">how to stream "Yellowstone" season 5, part 2</a>.

Kevin Costner says he didn't quit 'Yellowstone' and reveals his reaction to John Dutton's send-off

New Delhi: Ethanol plants manufacturer Regreen-Excel <keyword id="23123526" type="General" weightage="20" keywordseo="epc-india-ltd" source="keywords">EPC India Ltd</keyword> has filed preliminary papers with capital markets regulator <keyword id="35210" type="General" weightage="100" keywordseo="SEBI" source="Orion">Sebi</keyword> to raise funds through an initial public offering (IPO). The company's initial share-sale comprises a fresh issue of equity shares worth Rs 350 crore and an offer-for-sale (<keyword id="19951016" type="General" weightage="20" keywordseo="ofs" source="keywords">OFS</keyword>) of 1.14 crore equity shares by promoters, according to the draft red herring prospectus (DRHP). The company proposes to utilize the net proceeds from fresh issue for payment of debt, funding margin money requirements for the purpose of availing bank guarantees; and for general corporate purposes. Regreen-Excel EPCR is a technology-driven EPC company, engaged in designing, manufacturing and supplying ethanol plants. Over the years, the company has built end-to-end capabilities in setting up ethanol plants, across feedstocks such as molasses/ sugarcane syrup, grains or a combination thereof, which it to provide concept to commissioning solutions to their customers. Since the company's inception to July 15, 2024, it has executed 113 projects across various feedstocks, which consist of 53 molasses-based projects, 57 grains-based projects and three <keyword id="23123527" type="General" weightage="20" keywordseo="multi-feedstock" source="keywords">Multi Feedstock</keyword> projects. As of July 15, 2024, the company had an order book of 64 ongoing projects worth Rs 3,452 crore, which aggregate to over 10,000 kilo litres per day (<keyword id="23123525" type="General" weightage="20" keywordseo="klpd" source="keywords">KLPD</keyword>) of ethanol capacity. IIFL Securities and ICICI Securities are the book-running lead managers to the issue.

You Searched For "red herring" and got 12 results

Why investing in SME IPOs should not be on top of your adventure to-do list!

BI India Bureau

Smartworks Coworking Spaces files IPO papers with Sebi; eyes Rs 550 crore via fresh issue

PTI

PNB Housing Finance to raise Rs 2,500 cr through IPO

BI India Bureau

Giuliani says collusion is 'not a crime.' Legal experts say that's a 'red herring'

John Haltiwanger

Blaming Toronto's housing 'mania' on first-time homebuyers is a 'red herring'

Elena Holodny

GRANTHAM: 'US Fracking Is A Very Large Red Herring'

Myles Udland

GRANTHAM: 'US Fracking Is A Very Large Red Herring'

Myles Udland

FINANCIAL ADVISOR INSIGHTS: European Separatism Is One Of This Year's Biggest Red Herrings

Mamta Badkar

The IPO from India's largest asset management company UTI AMC is ready to hit the street

PTI

Investor bets against the dollar are at their biggest in almost 10 years, but rising Treasury yields are a red flag for bears, analysts say

Harry Robertson

Kevin Costner says he didn't quit 'Yellowstone' and reveals his reaction to John Dutton's send-off

Palmer Haasch

Regreen-Excel files IPO papers with Sebi, aims to raise Rs 350 crore

PTI

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